Money Makes Another Tipster Comes Forward, CFTC Hands out $7M

CFTC doesn’t provide any details of the enforcement case that came out of the whistleblower tip.

An unidentified person who told the US derivatives regulator about illegal activity at a financial institution will walk away with approximately $7 million, the CFTC announced Friday.

The agency explains that the tipster was eligible for its bounty after he provided unique information about significant wrongdoing at his company. He reported the same findings to his management, which opened internal probes into the alleged misconduct and then reported the results to the regulator.

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Committed to protecting the anonymity of informants, the CFTC doesn’t provide any details of the enforcement case that came out of the whistleblower tip — a policy intended to protect the identity of the tipster.

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Whistleblowers who voluntarily provide information to the commission leading to a successful enforcement action of $1 million or more are entitled to between 10 and 30 percent of the money that the CFTC recovers from those sanctions.

Money makes whistleblowers come forward

Monday’s announcement brings the whistleblower program’s total endowment to over $90 million since issuing its first award in 2012. CFTC’s enforcement actions from tip-offs have resulted in nearly $730 in fines since the program’s inception in 2011.

“This award shows that, in some cases, whistleblowers may provide information about wrongdoing that is not completely accurate, but if any information they provide leads us to open an investigation resulting in a successful enforcement action, we will reward them accordingly,” said CFTC Whistleblower Office Director Christopher Ehrman.

The US authorities consider several factors in determining the size of whistleblower awards. As long as the whistleblower’s internal disclosure prompted a company investigation, he can benefit from all the information discovered in that investigation. However, he should also report to the CFTC within 120 days of the internal disclosure; then the watchdog uses the date of the internal report in determining whether he provided original information.

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